XIP#4 Boost liquidity of Punk-Basic fund with NFTX
AI summary
This proposal, XIP#4, aims to significantly increase the liquidity of the $Punk-Basic fund on NFTX by creating a new NFTX/Punk-Basic trading pair on SushiSwap. It plans to use 86 Punk-Basic tokens and an equivalent value of NFTX tokens from the DAO's treasury to seed this new liquidity pool. The goal is to reduce price slippage for users buying or selling $Punk-Basic, making it more attractive than platforms like OpenSea.
If passed, NFTX will deploy a substantial amount of its treasury assets (86 Punk-Basic tokens and an equivalent value of NFTX tokens, potentially millions of dollars) into a new liquidity pool. This could benefit users by enabling smoother, cheaper transactions for $Punk-Basic, potentially increasing NFTX's trading fee revenue. However, the DAO faces the risk of impermanent loss if the price of CryptoPunks fluctuates significantly.
Voting results
🐳 Whale votes
0 votes > 5% VPFull proposal
Authors
Finesseboi, ChopChop
Glossary
- SLP
- Onsen
- Impermanent Losses
- Allocation Points
Summary
As it currently stands $Punk-Basic and other punk-based single (D1) funds do not have enough liquidity. Users would like to purchase $Punk-Basic but the slippage makes it a less than optimal solution. This proposal aims to rectify that, adding additional liquidity by creating NFTX/Single Fund pairs on SushiSwap, putting the currently inactive NFTX held by the treasury to work.
Rationale
The market currently values single funds more than combined funds. This may be the case becaus…